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The outlook for equity investment looks bleak, with month-on-month data showing a huge fall in activity in September compared to August.

There has been a significant decline in equity funding towards the end of 2016, with deal volumes crashing and pots of capital drying up.

Early-stage deals are down 37pc and growth-stage deals by 41pc in the third quarter of the year, compared with 2015, according to a new report from Beauhurst, which tracks high-growth companies.

The data has caused insiders to warn of a re-emergence of the funding gap, where growing companies are unable to find the larger rounds of funding required to scale.

We’re getting to the point where the novelty of certain sectors has worn off

The report showed that deal volumes are now back to their 2013 levels.

Beauhurst chief executive Toby Austin has blamed Brexit and market saturation for the slide. “With many high-growth companies facing questions over access to markets and talent we think that uncertainty is breeding caution and that’s impacting both supply and demand for investment across the board,” he said.

“Apps, breweries, food brands – we think we’re getting to the point where the novelty of certain sectors has worn off. We’re waiting for the next wave.”

Quarter on quarter, the number of deals has slipped by 16pc. However, due to the massive £210m investment in food delivery app Deliveroo, the overall value of deals done in the past three months rose 5pc on the previous quarter.

Some flavours of investment have fared worse than others. Deals completed by equity crowdfunding platforms fell 20pc - a record amount – compared with the previous quarter.

Deal numbers were only up in the East Midlands and the North East, and fell in all other regions

However, a spokesman for equity crowdfunding site Crowdcube emphasised that deal size is more important than volume. The total amount raised on the platform increased by 51pc to £86m over the 12 months to the end of September, compared to the previous year. “The number of deals rose slightly from 127 to 137,” the spokesman said. “While the quantity might not be growing by much, the value of those deals is getting bigger.”

However, looking at equity investment as a whole, the month-on-month data paints a bleak picture, showing a huge fall in activity in September compared with August.

The picture is also very different depending on where you are in the UK. London remains a deal-making powerhouse, but volumes have fallen. Deal numbers were only up in the East Midlands and the North East, and fell in all other regions. The greatest falls were felt in Yorkshire and Humberside, where deal numbers were down 69pc.

"This period of uncertainty is the new normal," said Stephen Welton, chief executive of equity investor BGF. "An extended slowdown across the wider industry would be concerning, and we need to make sure this does not become a trend.”

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